Above, the block west of Grand Central Terminal where SL Green is planning to build a 1.2-million-square-foot office building.

By LAURA KUSISTO and ELIOT BROWN
June 3, 2012

Quote:

SL Green Realty Corp., SLG -3.61%New York's largest office building owner but a relatively untested developer of new buildings, has taken a step forward in its ambitious plans to build a trophy office tower across the street from Grand Central Terminal. SL Green has brought in one of the country's most prominent office developers, Hines of Houston, Texas, to act as a consultant on the 1.2 million-square-foot project. The team is in the preliminary stages of drawing up plans for the block-long site on Madison Avenue between 42nd and 43rd streets, according to people familiar with the matter.

...SL Green executives clearly want to move forward. According to the transcript of an investor conference in December, Edward Piccinich, SL Green's executive vice president of property management and construction, said the company plans to build "a spectacular trophy asset with designs inspiration from around the world," drawing on iconic modern towers such as the Burj Khalifa in Dubai and the International Commerce Centre tower in Hong Kong.

"I imagined how the lines and the curves of these designs will make a huge impact on the city skyline. I thought about how great it would be [to] construct one of these tower[s] over Grand Central Terminal," Mr. Piccinich said.

While SL Green owns more than 25 million square feet of office space in the city, most of its development experience has been with overhauling existing office buildings. Development of new buildings "is not in their DNA," says Michael Knott, an analyst at Green Street Advisors. "I don't think that they have an intention to dive headlong into ground-up development. It's more of a one-off, once-in-a-lifetime opportunity."

Hines, in contrast, is known for designing ambitious office towers with star architects, including Philip Johnson's Lipstick Building and the Skidmore, Owings & Merrill-designed 450 Lexington Ave. Indeed, fewer than five blocks away from the SL Green site, Hines has plans to build its own office tower overlooking Bryant Park.

SL Green's site would likely be included in a proposed rezoning of the area around Grand Central that would allow larger office buildings. The details of the rezoning haven't been settled.

The city is poised to see millions of square feet of new office space hit the market in the coming years, but much of it is at the World Trade Center and on the far west side. In the past two decades, there's been very little new construction in the Grand Central area, a highly desirable location because of its proximity to the commuting hub.That's, in part, because the current zoning makes it difficult for developers to build tall new office towers. "The fact that there's someone who's willing to build a modern office building [near Grand Central], that's sending a message that this will continue to be the most important business district in the city and around the world," says Steven Spinola, president of the Real Estate Board of New York.

The Grand Central area will have some pretty intersting developments in the next few years.

____________________________________________________________________

Update:

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

16.

17.

18.

19.

20.

21.

22.

23.

24.

25.

26.

27.

28.

29.

30.

31.

32.

33.

34.

35.

36.

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

1.2 MSF isn't all that large for an office tower, and even with a 30% upzoning, 1.6 MSF isn't enormous either. Maybe 50 floors max?

You have to read between the lines here. Whatever they plan to develop, they plan it to be a signature tower that will change the skyline, and we still don't know exactly what the City will kick in for the sight, which is directly opposite (and above) Grand Central.

Quote:

SL Green's executive vice president of property management and construction, said the company plans to build "a spectacular trophy asset with designs inspiration from around the world," drawing on iconic modern towers such as the Burj Khalifa in Dubai and the International Commerce Centre tower in Hong Kong.

"I imagined how the lines and the curves of these designs will make a huge impact on the city skyline. I thought about how great it would be [to] construct one of these tower[s] over Grand Central Terminal," Mr. Piccinich said.....Development of new buildings "is not in their DNA," says Michael Knott, an analyst at Green Street Advisors. "I don't think that they have an intention to dive headlong into ground-up development. It's more of a one-off, once-in-a-lifetime opportunity."

I would expect something spectacular here. Another look at the area from google earth:

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

SL Green has also been hard to ignore lately. The company currently has 34 buildings totaling 22.9 million square feet. A handful of those properties have been picked up in the last few years. The firm, which ranked No. 2 on the list with $790 million in total NOI, owns a broad collection of buildings spread throughout Manhattan. Its top-earning building is the 1.6 million-square-foot Times Square office tower 1515 Broadway, which is throwing off $70 million a year — more income than any other building in the firm’s New York portfolio, according to city records. And the building will remain a money-maker for years. That’s because the media behemoth Viacom signed the largest lease of the year — a renewal and expansion — in April, and is expected to occupy the entire building in coming years.

SL Green has been especially active buying and selling properties over the past year. For example, it unloaded 28 West 44th Street for $161 million in May 2011, and in December purchased 51 East 42nd Street, which is part of a potential 1.2 million-square-foot office development site on a small square block bounded by Madison and Vanderbilt avenues, and 42nd and 43rd streets.

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

1.2 MSF isn't all that large for an office tower, and even with a 30% upzoning, 1.6 MSF isn't enormous either. Maybe 50 floors max?

The proposed upzoning would allow for a rough 50% increase in developable floor area.

This site is also eligible for Grand Central Terminal air rights transfer, which could be significant (though there are many other proposed towers that would want some of these air rights). There are over 1 million square feet of available air rights from Grand Central.

So you could very easily be talking about a 2 million square foot tower, like One Bryant Park. Perhaps significantly taller, even, because this is a much smaller footprint.

But this is all speculation at this point. I do like, however, the fact that they're referencing Burj Khalifa in Dubai and International Finance Center in Hong Kong. It looks like they want something soaring and iconic.

But this is all speculation at this point. I do like, however, the fact that they're referencing Burj Khalifa in Dubai and International Finance Center in Hong Kong. It looks like they want something soaring and iconic.

This will be their one chance at building a signature tower from the ground up:

Quote:

"I don't think that they have an intention to dive headlong into ground-up development. It's more of a one-off, once-in-a-lifetime opportunity."

They want a tower that will mark it's presence strongly on the skyline, something becoming harder to do. Since there is little we know about what exactly the tower will look like, we just have to go with their words on this one. It's also possible some residential or hotel space could be thrown on top. With the City's hand in this, everything is possible.

Quote:

"I imagined how the lines and the curves of these designs will make a huge impact on the city skyline...." Mr. Piccinich said.

This is the third new office tower in the Park Ave/Grand Central district to keep an eye on.

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

Excellent!!!
We already know of 237 Park, 425 Park, 432 Park, 225 W57th and now a fifth supertall for midtown. Since this is such a prime location I'm certain that something interesting & tall will rise here.

SL Green Realty Corp. is moving forward with its plans to develop a 1.2 million-square-foot office tower located directly across Grand Central Terminal, according to a Wall Street Journal report.

The block-long site, located on Madison Avenue between 42nd and 43rd streets, will be the real estate investment trust’s first major foray into developing an office tower. It will also bear the fruit of its active investment in that particular region: After it purchased 51 East 42nd Street –an 18-story, 142,000-square-foot building– in December 2001, SL Green now owns all of the buildings on East 42nd and East 43rd Streets bounded Madison and Vanderbilt Avenues. Other buildings include 317 Madison Avenue (which was acquired in 2001), along with 331 Madison Avenue and 48 East 43rd Street (both acquired in 2007).

It was also that same year that SL Green sold 110 East 42nd Street but retained the air rights to the building, with the option of transferring those rights over to the Madison block, said Edward Piccinich, a vice president of property management and construction for SL Green during an investor conference in December. As part of that deal, SL Green spent nearly $6 million in restoration work on 110 East 42nd Street, a landmarked building, after the REIT reached a deal with the city Landmarks Preservation Commission. SL Green also conducted a zoning lot merger on the block to help facilitate its plans for the new building.

“The total area following demolition will yield an acre of land to create our footprint to place our state-of-the-art structure in Manhattan,” Mr. Piccinich told investors.

Although no architect has been hired for the project, the design of the new office tower will hearken back to other “prestigious properties,” like the Burj in Dubai, Mori Tower in Tokyo, the ICC Tower in Hong Kong, the World Financial Center in Shanghai and the Petronas Towers.

I think its clear they intend to build a supertall skyscraper here. It's great location for it, both in the City and on the skyline.

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

The site is comprised of 4 distinct building lots on a single block with the Grand Central terminal being our direct neighbor to the east. In order to move forward with our concept of creating a signature tower, we performed a zoning lot merger on the block. The total area following demolition will yield an acre of land to create our footprint to place our state-of-the-art structure in Manhattan..... We've been able to capitalize in a significant amount of revenue by the phased assemblage of the block. Unlike a typical development site, instead of sitting on an empty lot, paying taxes and not generating revenue, we instead have maintained the building's occupancy and collected rent.

As part of the transfer, New York City will require us to perform improvements to MTA's pedestrian circulation. We are giving serious consideration to leveraging this requirement by creating a direct connection to Grand Central terminal. One huge advantage of our location is the proximity to one of the most significant transportation hubs in New York City, providing direct access to Metro-North and subways including the Times Square shuttle, the 4, 5, 6 and 7 trains. We also expect to potentially tie in 2 other ongoing projects; the 2nd Avenue subway, where transfer options are under evaluation, and the east side access, which will link the Long Island Railroad and New Jersey transit to Grand Central. This increase to the site will exponentially enhance the intrinsic value of this particular location. The connection we are considering would be an amenity that would allow someone coming into Grand Central to walk through an underground tunnel beneath Vanderbilt Avenue and arrive at our proposed building without ever having to step a foot outside.

So what's next? Some of the prestigious properties are considered as inspiration prior to us engaging a world-class architect, including the Burj in Dubai, Mori Tower in Tokyo, the ICC Tower in Hong Kong, the World Financial Center in Shanghai and the Petronas Towers.

I began building my itinerary and scheduling appointments to visit the buildings in order to perform full inspections of each of these properties. With each being revered for its own brand of uniqueness in terms of infrastructure, technology, environmental, sustainability, I felt I would be missing out if I didn't lay my eyes on all these modern marvels of wonder. So to fully appreciate the pioneering design and engineering features, I went to the Burj in Dubai where I had the opportunity to personally visit the spectacular gem. Upon my return from Dubai, my creative juices started flowing. I could begin even picturing each of my inspirations clearly. Although each have their own aesthetic, I imagine how the lines and the curves of these designs would make a huge impact on the city's skyline. I've thought about how great it would be to construct one of these behemoths, The Tower over Grand Central Terminal. So I reboarded back to [ph] my recent trip, and my upcoming itinerary to complete my tour of the remaining 4 buildings, which would take me out back to the Middle East and Asia.

...the final product will, of course, have to take into consideration such things as zoning, landmarks and community considerations. We expect our new tower will be more of a balance between these dynamic designs and something more traditional in keeping with the surrounding area, nothing Amanda Burton, City Planning or others would find objectionable. The ultimate end product will determine our analysis of market demand and our decision of what would be most ideal for the area, whether it be office, hotel, residential or mixed use. Evaluating our options at this point will allow us to construct a building that's best suited to leverage this prime location.

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

How do they intend to build a building well over 1000 feet with only 1.2msf. I'm assuming they'll add more?

The 1.2 million square feet is the current "as of right".

The area is being signficantly upzoned, however, and there are considerable air rights available for purchase from Grand Central Terminal.

It also looks like they're planning a significant transit connection with Grand Central, and the various subway lines. If they invest in a major connection, they will likely get additional air rights (as with Vornado's planned 15 Penn Plaza tower).

The area is being signficantly upzoned, however, and there are considerable air rights available for purchase from Grand Central Terminal.

And as was done with the Hudson Yards zoning, there will be varying FARs applied to the sites on the east side, though all rezoned sites would be capable of building larger than they currently are. Being literally at Grand Central's doorstep, I would expect a real push for a greater FAR here and at the Park Avenue Atrium. One thing Amanda Burden believes in is density. What better place to have it than around the city's transit centers.

With all of the new skyscraper developments being planned and built around the City, this is the first tower to take inspiration from the great towers around the world. For so long, New York's skyline has been an inspiration for others. They are basically saying, "Listen, it's time New York got back in the business of building bold, iconic skyscrapers just because." I'm all for it, and looking forward to the design process. Hines is on board, and in the past they went with Jean Nouvel's bolder alternative for the Torre Verre. Very excited for this one.

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.